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Cebu Pacific narrowed its net loss by 31.1% in the first half of the year
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First-half revenue soared 250.3% year-on-year, primarily driven by surging passenger volume, cargo services and flight frequencies since easing of COVID-19 restrictions by March 2022
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Cargo revenue jumped 26.8% as a result of a 22.7% hike in cargo kilograms carried and a 3.4% rise in cargo yield
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The airline is cautiously optimistic of turning the tide soon as domestic demand looks robust and international borders continue to reopen
Cebu Pacific narrowed its first-half net loss by 31.1% to P9.50 billion from a net loss of P13.79 billion in the same period last year.
Revenue for the same period in review soared 250.3% to P20.68 billion from P5.90 billion, parent firm Cebu Air Inc. said in a regulatory disclosure.
For the second quarter alone, the airline in a statement said revenue rocketed 337% to P13.97 billion from P3.2 billion in the same period in 2021, as it operated more flights and flew more passengers after travel restrictions eased.
Net loss narrowed to P1.9 billion from P6.5 billion last year. Positive EBITDA of P453 million was also recorded, a 121% jump from negative P2.1 billion last year.
In the second quarter of 2022, most parts of the country remained under the more relaxed alert Level 1 status. As a result, Cebu Pacific has restored almost the same level of capacity as its pre-pandemic system-wide capacity following the continuous ramp-up of domestic and international routes.
Revenue growth for the second quarter was driven primarily by strong recovery in the passenger and ancillary business which grew 644% and 572% year-on-year, respectively. Similarly, the cargo business sustained its growth with a 15% increase to P1.7 billion against last year on the back of higher cargo volumes.
Seat load factor of 77% was 21 points higher than last year’s 56%, the airline said. The improvement in load factor resulted from the network recovery driven by the domestic market where passengers flown increased 562% year-on-year while flights grew 350% year-on-year.
Total operating expenses totaled P16.8 billion, 86% higher year on year despite 323% more flights. Fuel was the biggest contributor to expenses due to the steep hike in jet fuel prices.
Cebu Pacific said it expects the level of demand for airline services to increase further not just within the Philippines but even abroad. It said this positive development has allowed the group, which includes subsidiaries such as Cebgo, to carry more passengers and boost cargo services.
Passenger revenues shot up 474.5% to P11.67 billion in the first half from P2.03 billion in the same period last year, which the airline mainly attributed to a 428.1% upsurge in passenger volume from 1.2 million to 6.3 million as the number of flights soared 224.4%.
For the same period in review, cargo revenue increased 26.8% to P3.57 billion from P2.82 billion, primarily driven by a 22.7% increase in cargo kilograms carried from 53.8 million to 66 million, coupled with a 3.4% rise in cargo yield.
Ancillary revenues likewise rose 414.2% in the fist half to P5.45 billion from P1.06 billion largely on higher passenger volume and more flights.
Operating expenses climbed 55.1% to P28.84 billion from P18.59 billion, mostly driven by the increase in operations due to the eased COVID-19 restrictions, since a material portion of its expenses are based on flights and flight hours.
Cebu Pacific said its international network has started to recover as travel requirements of other Southeast Asian countries such as Singapore and Thailand have eased. The airline also expanded its network as it resumed flights to Hanoi, Bali, and Taiwan in the second quarter.
“Amidst the risks posed by expensive jet fuel, peso depreciation and interest rate hikes, CEB remains cautiously optimistic that we can turn the tide soon as domestic demand looks robust and international borders continue to reopen. We continue to stay true to our commitment of providing accessible air transport service for everyone,” Cebu Pacific chief financial officer Mark Cezar said.
As of June, Cebu Pacific was operating a route network serving 66 domestic and 16 international destinations with a total of 2,384 scheduled weekly flights.
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